Private equity firm SSG Capital Management has acquired an additional 11.58% stake in Cox & Kings’ UK subsidiary Prometheon Holdings Ltd, the Mumbai-based tours and travel company said in a regulatory filing on Friday.
In November 2017, SSG had picked up a 34.4% stake in Prometheon Holdings for $200 million, in a secondary transaction that saw The Rohatyn Group exit the company.
With this transaction, SSG Capital has raised its stake to 46% in Prometheon Holdings, while Cox & Kings will retain its 54% stake in Prometheon Holdings through its subsidiary Prometheon Enterprises Ltd.
Based on the previous transaction, SSG Capital might have paid $65-70 million for the 11.58% stake in the company.
Prometheon Holdings owns Holidaybreak, which houses brands such as Travel Works and Meininger. Over the last few years, Cox & Kings has been divesting assets to sharpen its focus on leisure, education and hybrid hotels as well as to pay off its debt.
“In continuation with our efforts to unlock value across businesses, we have divested 11.58% stake in Prometheon Holdings UK to SSG Capital,” said Peter Kerkar, Group CEO, Cox & Kings Ltd. “We consider SSG as a strong partner and look forward to leveraging their position and working together to enhance the value of education and hybrid hotels businesses.”
A large part of its debt was accrued when it had acquired Holidaybreak through Prometheon Holdings in 2011. The deal was pegged at $510 million (Rs 2,260 crore). Holidaybreak gave it a bouquet of units in the travel and tours space, especially focussed on the European market, including hostel brand Meininger.
In November 2014, Cox & Kings had raised funds through a qualified institutional placement largely to pare debt. In December the following year, the firm sold its UK-based adventure holiday unit Explore Worldwide Ltd to Hotelplan UK Group for £25.8 million ($39 million).
In October 2015, the company acquired UK-based hotel booking website LateRooms.com for £8.5 million ($13 million). However, it swiftly divested a majority stake in the asset within a year.
In a parallel transaction, Cox & Kings sold LateRooms.com and Superbreak for about £29.25 million ($43 million) to UK-based Malvern Enterprises, while it acquired a 49% stake in Malvern for £6.37 million ($9 million). The firm had said that the proceeds from the twin deal would be used to pay off debt.
Cox & Kings, which has operations in 22 countries across four continents, reported revenues of Rs 3,117 crore for the financial year ended 31 March 2017.
It competes with Fairbridge Capital-controlled Thomas Cook, among many other local and international travel services firms. Its scrip closed 3.03% down at Rs 233.55, apiece, on the BSE on Friday.